RBS And NatWest Hit By Mobile Banking Glitch

Mobile banking services for RBS and NatWest have been hit by an IT glitch, along with an unconnected problem that affected some Lloyds, Halifax and Bank of Scotland online users.

In a statement given to Sky News, a spokesperson for RBS Group said: "Some customers may have had trouble getting into mobile banking today between 8.40am and 2.30pm.

"All services are back up and running as normal.  We apologise for any inconvenience this caused."

A spokesman for Lloyds Banking Group said there was a temporary issue on Friday morning that affected mobile and online services for a small number of customers who were trying to set up payments at Lloyds, Halifax and Bank of Scotland.

The apology seen by NatWest smartphones users

A Lloyds spokesman said: "We are aware that a small number of customers experienced issues accessing payments this morning.

"The issue has now been rectified and we are working with those customers who were affected."

The RBS Group has been hit be a sequence of system-wide IT failures in the past, which affected RBS, NatWest and Ulster Bank.

More recently, it has suffered 'pay day problems'  in the past, when workers expect to see funds enter their accounts.

Branch and cash machines are believed to be unaffected by the latest woes.

In its last annual results, the group said it was investing heavily in computer infrastructure to modernise its systems.

A number of banks were affected in February when workers expected funds to be deposited.

According to the British Bankers' Association, the use of mobile devices for banking services has doubled in the past 12 months.

RBS saw more than 17 million log ins in one week, through its mobile app, earlier this month.

In late December the group was hit by its fourth IT failure, after a cyber attack left online users unable to access accounts.

That followed an outage in early December, on one of the year's busiest shopping days.

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Barclays Fined £26m Over Trader's Gold Fixing

Barclays Bank has been fined more than £26m by the City watchdog over failings related to gold price manipulation by one of its former traders.

The Financial Conduct Authority (FCA) said the bank failed to adequately manage conflicts of interest between itself and customers.

It said oversight failures occurred between 2004 and 2013 led to the £26,033,500 fine.

The trader manipulated the rate in the bank's interest just a day after UK and US regulators fined it $450m (£290m) over attempted rigging of the Libor - an interbank lending rate - that has global impact.

Barclays was fined for oversight failures and not for the price manipulation by the worker.

It agreed to settle the case at an early stage, saving itself a 30% additional penalty.

Gold fixing is a financial term used to describe the somewhat arcane price-setting mechanism that allows investors to buy and sell gold at a single quoted price.

Barclays is one of four banks that sets the price of the precious metal twice a day, in US dollars, on the London Gold Exchange and in Paris and Zurich.

It joined the group in 2004, and the other members are Scotiabank, Societe Generale and HSBC.

The FCA said: "On 28 June 2012, former Barclays trader Daniel James Plunkett exploited the weaknesses in Barclays' systems and controls to seek to influence that day's 3pm setting of the gold price and thereby profited at a customer's expense.

Barclays boss Antony Jenkins has apologised for the latest scandal

"As a result of Plunkett's actions, Barclays was not obligated to make a $3.9m (£2.3m) payment to its customer, although it later compensated the customer in full.

"Plunkett's actions boosted his own trading book by $1.75m - £1m - (excluding hedging)."

The watchdog also fined Mr Plunkett £95,600 and has banned him from performing any function in relation to any regulated activity.

He can, however, work in financial markets in other countries.

The FCA said the trader used the phrase "mini puke" in an email to describe the drop in gold price ahead of the June 28 pricing figure.

Responding to the latest fine imposed by regulators, Barclays CEO Antony Jenkins said: "We very much regret the situation that led to this settlement.

"Barclays has undertaken a significant amount of work to enhance our systems and controls and is committed to the highest standards across all of our operations."

Meanwhile, the chairman of the Treasury Select Committee welcomed the ongoing attempts to improve integrity of the much-maligned banking sector.

Andrew Tyrie MP, the former chairman of the Parliamentary Commission on Banking Standards, said: "It is essential that the regulators do what is necessary to give us confidence that the integrity of these markets is being maintained.

"It is equally essential that the drive to improve standards with the fundamental reforms outlined by the Parliamentary Commission among others is maintained."

The gold price manipulation scandal is the latest issue to tarnish the reputation of Barclays.

It recently suffered a shareholder backlash - announcing a 32% fall in annual profits to £5.2bn but raising its staff bonus pool by 10% to £2.38bn.

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Blackstone In Joint Bid For Friends' Tax Arm

By Mark Kleinman, City Editor

The private equity giant Blackstone has joined forces with a US-based specialist insurer to table a bid for the tax planning arm of Friends Life, the FTSE-100 financial services group.

Sky News understands that Blackstone and Philadelphia Financial will make a joint offer for Lombard, which specialises in wealth planning solutions for some of the world's wealthiest people.

Philadelphia Financial targets high net-worth families through a network of intermediaries, and is understood to view Lombard as an attractive opportunity to expand that area of its business.

Friends Life has been in talks to sell the division for more than six months and is understood to have set a deadline in June for offers from interested parties.

Permira, another private equity group, is also expected to lodge a bid, while interest from Warburg Pincus, another private equity firm, is said to have waned.

Responding to Sky News' disclosure of the sale plan last November, Friends Life, which was then called Resolution, said: "Resolution notes the recent speculation in the press regarding the potential disposal of its Lombard division, which comprises Lombard International Assurance S.A. and Insurance Development Holdings AG, and confirms that it is currently in discussions regarding the possible disposal.

"There is no certainty these discussions will result in a transaction being agreed. A further announcement will be made as and when appropriate."

Analysts say the Lombard unit, which is being auctioned by investment bankers at Barclays, could be sold for £400m.

Based in Luxembourg, Lombard offers "wealth planning solutions to high and ultra-high net worth individuals".

The business is viewed as non-core by Friends Life's board and a sale would see the company re-orient itself towards its home market in the UK, analysts said.

Lombard uses Luxembourg's light-touch tax regime to help shield clients' assets from the taxman and is understood to include dozens of billionaires among its key customers.

Insiders said that Friends Life was also likely to consider the sale of Friends Provident International (FPI), which provides life assurance and investment products in Asia, the Middle East and some other markets, in due course, although no sale process for that business had yet been formally planned.

FPI has offices in the United Arab Emirates, Hong Kong, Singapore and the Isle of Man, and primarily distributes through independent financial advisers and strategic partnerships.

Andy Briggs, Friends Life's chief executive, said late last year that it was planning to compete more aggressively with specialist annuity providers such as Just Retirement, which recently floated on the London Stock Exchange.

In March, it issued updated guidance on its plans in the wake of George Osborne's shake-up of the annuities market.

He said: "There is a negative implication for new business flows in the individual annuity market, as some people utilise the increased flexibility provided by the Chancellor's proposals.

"However, we believe that annuities will continue to be an important product for those who value the guaranteed income throughout increasingly long retirement periods."

Blackstone, Permira and Friends Life all declined to comment on Friday.

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Fracking: Southern England 'Ripe For Drilling'

Large reserves of shale oil are expected to be revealed as a new report today highlights the possibility of fracking across southern England.

The long-awaited survey by the British Geological Survey (BGS) is likely to confirm substantial reserves in Conservative strongholds Kent, Sussex, Surrey and Hampshire.

It comes as communities affected by fracking will reportedly be offered average payouts of £800,000 to try to win over opponents of the technique.

Prime Minister David Cameron, a supporter of fracking, will announce the extra compensation in addition to a one-off payment of £100,000 and a 1% share of profits, according to The Times.

Anti-fracking protests took place last year in Balcombe, West Sussex

The BGS has already suggested there could be enough shale gas in the north of England to supply Britain for 40 years.

And it now it appears large areas of the south are in line for the controversial extraction technique.

The South Downs National Park lies across much of the area likely to hold reserves totalling several billion barrels of oil.

Supporters believe fracking will lead to lower energy bills and create thousands of jobs.

But critics claim it harms the environment, including potentially causing small earthquakes and polluting water supplies.

Fracking firm Cuadrilla faced fierce protests last year over its exploratory drilling plans at Balcombe, West Sussex, with some activists arrested.

Licences have already been approved for areas such as Lancashire, with further swathes of the country said to have fracking potential.

Fracking involves fracturing underground rocks to release oil and gas

The technique, widely used in the US, involves high pressure liquid being pumped deep underground to split shale rock and release gas and oil supplies.

Ministers are also said to be planning to give energy firms the right to lay pipelines under houses without worrying about trespass laws.

This would mean they would not have to get permission from homeowners.

Business Secretary Vince Cable told Sky News that drilling under houses had been going on for years in the coal industry.

"It's not been any issue," said the Liberal Democrat MP.

"We're talking about activity well, well below ground level - not under people's gardens. Providing that's clearly understood, it creates less of a problem."

Mr Cable said people involved in the fracking debate appeared to be "over-reacting in both directions".

"People are terrified this is going to pollute and compromise the environment - it doesn't have to do that.

"People think it's going to be some great economic bonanza - I doubt that."

Oil and gas in the North Sea is still attracting investment and is a key part of the UK's energy supply, the Business Secretary told Sky.

"There is a danger that people get so obsessed by the long-term possibilities of fracking ... It's a long way to go.

"People think this is some miracle round the corner - it certainly isn't that. Providing there are proper safeguards for the environment, and there have to be proper safeguards, there is no reason why it should create a backlash."

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New Trains In Seven-Year Rail Franchise Win

Three new state-of-the-art electric train fleets are to be rolled out on the busiest rail routes in London and the South East.

The new Thameslink, Southern and Great Northern (TSGN) franchise will be run by Govia, with rival FirstGroup missing out.

Govia has been awarded a seven-year contract, which includes construction of nearly 1,400 new carriages.

Govia is 65% owned by the Go-Ahead Group and 35% by France's Keolis.

The franchise will carry more than 280 million passengers annually.

Go-Ahead Group CEO David Brown said: "I'm delighted the (Depatment for Transport) has chosen us to operate this important and complex franchise and to play an instrumental role in delivering the benefits of the Government's £6bn Thameslink programme.

"This will be the UK's busiest franchise and we will be introducing 50% more capacity into central London during peak times, with 26% more morning peak carriages providing 10,000 additional seats."

Services and capacity are expected to be improved to scores of destinations, including Brighton, King's Lynn, Cambridge, Peterborough, Bedford, Luton and Gatwick.

The improved service is due to be fully operational by the end of 2018 and will also include improved staffing and stations, along with a simplified ticket structure.

Rail minister Stephen Hammond said: "A world-class railway is a vital part of our long-term economic plan.

The improved service and trains will be spread across the South East

"That's great news for businesses and the hundreds of thousands of passengers who use these vital services every day."

The new franchise, the largest ever in terms of passenger numbers, is a blow to the current Thameslink operator FirstGroup.

Govia presently operates the other rail contract incorporated into the new franchise.

Twenty-four trains will be able to travel between Blackfriars and St Pancras each hour.

New tunnels will also link Peterborough and Cambridge to the existing Thameslink network, boosting access from the North to Gatwick and Brighton.

Govia beat competition from four short-listed bidders - Abellio, FirstGroup, MTR and Stagecoach - to run the key commuter contract from September.

The Go-Ahead Group's partner Keolis is 70% owned by French rail operator SNCF.

After the announcement, FirstGroup CEO Tim O'Toole said: "I am disappointed that we will not be operating the new franchise and taking the Thameslink programme on to its next stage.

"We submitted a strong bid which would have delivered high quality services for passengers, value for taxpayers and an economic return for shareholders."

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Barclays Fined £26m Over Gold Fixing Attempts

Barclays Bank has been fined more than £26m by the City watchdog over attempted gold price manipulation, it has been confirmed.

The Financial Conduct Authority (FCA) said the bank failed to adequately manage conflicts of interest between itself and customers.

It said failures occurred between 2004 and 2013.

The bank, which has previously been fined over Libor rate-fixing, was fined £26,033,500.

Gold fixing is a financial term used to describe the somewhat arcane price-setting mechanism that allows investors to buy and sell gold at a single quoted price.

Barclays is one of four banks that sets the price of the precious metal twice a day, in US dollars, on the London Gold Exchange and in Paris and Zurich.

It joined the group in 2004, and the other members are Scotiabank, Societe Generale and HSBC.

The FCA said: "On 28 June 2012, former Barclays trader Daniel James Plunkett exploited the weaknesses in Barclays' systems and controls to seek to influence that day's 3pm setting of the gold price and thereby profited at a customer's expense."

"As a result of Plunkett's actions, Barclays was not obligated to make a US$3.9m (£2.3m) payment to its customer, although it later compensated the customer in full.

"Plunkett's actions boosted his own trading book by US$1.75m (excluding hedging)."

The watchdog also fined Mr Plunkett £95,600 and has banned him from performing any function in relation to any regulated activity.

He can, however, work in financial markets in other countries.

The gold price manipulation scandal is the latest issue to tarnish the reputation of the bank.

It recently suffered a shareholder backlash - announcing a 32% fall in annual profits to £5.2bn but raising its staff bonus pool by 10% to £2.38bn.

Responding to the latest fine imposed by regulators, Barclays CEO Antony Jenkins said: "We very much regret the situation that led to this settlement.

"Barclays has undertaken a significant amount of work to enhance our systems and controls and is committed to the highest standards across all of our operations."

16.02 | 0 komentar | Read More

Fat Face Pulls Float As City IPO Fashion Fades

By Mark Kleinman, City Editor

The fashion retailer Fat Face is expected to abandon its planned flotation in a move that could mark a turning point in the City's frenzy of recent company listings.

Sky News understands that the chain, which is controlled by the private equity firm Bridgepoint, decided on Wednesday evening to call off its initial public offering (IPO), which was due to raise £110m.

An announcement could be made as soon as Thursday.

Advisers to the company are said to have informed board members that there was insufficient demand at the level at which it wanted to sell shares to new investors.

City insiders said the decision was less a reflection of Fat Face's appeal to prospective shareholders and more about a broader recent change in confidence among City institutions.

In recent weeks, Card Factory, another retailer, has disappointed after coming to the market, while Saga said on Wednesday it was cutting the price range for its IPO despite what it claimed was buoyant demand.

So far this year, Appliances Online, which has also traded down since its debut, Pets At Home and Poundland have floated, with the sofa retailer DFS also poised to do so in the coming months.

Fat Face is chaired by Sir Stuart Rose, the former Marks & Spencer (M&S) boss, who also chairs the online grocer Ocado.

Fat Face has more than 200 stores in the UK and Ireland, and plans to open shops in Boston in the US during the next 18 months.

Fat Face's announcement of its intention to float would say it was seeking gross proceeds from investors of tens of millions of pounds to fund its growth.

The chain was established in 1988 selling T-shirts in the Alps.

Its controlling shareholder, Bridgepoint, has been an investor since 2007, and has not had an entirely trouble-free period of ownership, having to inject additional capital during difficult trading conditions.

However, the company has been performing strongly in recent times, with sales understood to have approached £180m in 2013, and robust like-for-like revenue growth.

Fat Face could not be reached for comment on Wednesday.

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Meet Darkcoin - Bitcoin's Shadowy Cousin

Cryptocurrency Darkcoin - known as the shadowy cousin of Bitcoin - is booming.

In just one month, the value of the little-known alternative online currency has soared from 75 cents (45p) to $7 (£4.14).

Its main selling point is its increased anonymity in comparison to Bitcoin - meaning it is very difficult to trace a payment to a person.

Cryptocurrencies like Bitcoin have soared in popularity, and have become notorious as a way to buy drugs, weapons and other illicit items online.

Darkcoin is one of the fastest-growing cryptocurrencies, and the total value of its combined coins is around $30m (£17.8m).

The extra layer of anonymity comes from the way Darkcoin jumbles up the transactions individual users make with those of two other users.

The feature, called Darksend, means discovering where a user's cash has ended up is more difficult.

Bitcoin consultant Kristov Atlas told Wired he believed the price rise was based on the privacy features, and was not just a bubble.

He said: "It's not purely a speculative bubble. There's some solid indications the market price is currently based on the fundamental value of the coin."

Bitcoin trader Allen Price added: "I had sort of smugly stood to the side waiting for the big, inevitable crash with an 'I told you so' ready.

"But no crash ever really came, and it's been kind of an ongoing success for investors."

Like Bitcoin, Darkcoin can be "mined" by anyone who repeatedly carries out a specific computer function using powerful hardware.

The value of the currency is based on trades between creators and owners of the Darkcoin.

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Royal Mail Posts £430m In Full-Year Profits

Royal Mail has reported an operating profit of £430m in its first full-year results since privatisation.

The figure for the 12 months to March, after transformation costs, is up from £403m in the previous year - a rise of 6.7%.

But the company warns it is facing a number of "headwinds" including increasing competition in parcels.

The Royal Mail also warned a move to direct delivery of letters by rivals TNT Post could threaten the financial sustainability of the universal service without action by the regulator Ofcom.

The company is legally obliged to deliver to every address in the country for a single price, and it warns the TNT plans could lose the firm £200m.

Chief executive Moya Greene said: "We can't just sit around waiting for the damage to be done, there has to be action now. Ofcom's duty is to secure the financial sustainability of the Universal Service Obligation."

But an Ofcom spokesman said: "We do not believe that there is presently a threat to the financial sustainability of the universal postal service.

"We have a duty to secure the universal service, and if we identify any future threat we have powers to step in to protect it.

"We would expect Royal Mail to take appropriate steps to respond to the challenge posed by competition, including improving efficiency."

Parcels now contribute more than 50% of Royal Mail's revenue - £4.82bn - after a 7% rise, although volumes remained flat.

On Wednesday, the firm announced it will start delivering parcels and opening delivery offices on Sundays, in response to the rapid growth of online shopping.

Ms Greene said: "The competitive environment on the parcels side is more intense. We are taking steps to remain the leader in this growing market."

The group's letters performance was at the better end of expectations, with revenues down 2% to £4.6bn on a year earlier.

The amount of letters fell by 4%, but the trend improved over the year due to better economic conditions and one-off factors such as energy companies writing to customers about price rises.

Shares in the firm opened more than 3% lower. However at 553p the stock is still much higher than the 330p valuation placed at the time of the flotation.

The Government still own a 30% stake in Royal Mail, which was sold off last autumn.

But the privatisation was heavily criticised for not delivering value for money for the taxpayer.

The Government robustly defended the sale against sharp criticism from the National Audit Office, which found that "deep caution" shown by ministers when pricing shares in the Royal Mail cost the taxpayer more than £1bn.

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SSE Sees Profit Up 9.6% Amid Price Hikes

Energy giant SSE has seen its full-year adjusted pre-tax profit rise by 9.6% to £1.55bn, just months after announcing price increases.

But it saw the retail division operating profit fall 28.6% to £292m in the year to March 31 as energy usage plunged during the mild winter.

SSE is Britain's second largest provider of household energy and announced it would increase prices last autumn.

It said increased output from renewable energy helped its wholesale arm's operating profit rise to £634.6m - up 24.8%.

During the last year SSE has topped several customer complaint league tables compiled by consumer groups.

SSE lost 370,000 customers during the year - more than 1,000 a day - in a drift towards smaller and independent providers.

In a swipe at the likely backlash over profits, it pointed to a report by accounting giant PwC which found that in the previous financial year the energy firm contributed £9.1bn to UK gross domestic product and supported 112,000 jobs.

Sky's Eamonn Holmes interviewed SSE Group managing director Will Morris after the results were released.

Asked by Holmes if the company would reduce prices for consumers amid reducing wholesale prices, Mr Morris said: "It has been a tough year.

"We will look constantly and if there is a sustained fall ... We know customers care most about having certainty and peace of mind."

A political and consumer backlash over energy firms raising prices saw SSE decide to freeze its energy tariffs last March, until January 2016.

The company's electricity transmission operating profit however, rose by nearly half due to a major increase in investment which its chairman Robert Smith said would continue with a net investment of around £5.5bn over four years in the network.

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Royal Mail Launches Sunday Parcel Deliveries

Royal Mail is to start delivering parcels and opening delivery offices on Sundays, in response to the rapid growth of online shopping.

The recently-privatised firm says parcels will be delivered on Sundays later this summer to addresses within the M25. 

Around 100 of the busiest delivery offices will open on Sunday afternoons as part of the pilot.

The group's express parcels business, Parcelforce Worldwide, will also launch a Sunday delivery service in June for online shoppers through participating e-retailers.

Parcelforce Worldwide will make the service available to contract customers across the UK.

Shoppers who choose the Sunday service through registered retailers will receive a text message between 30 and 90 minutes before delivery.

Royal Mail said the changes were being introduced under an agreement with the Communication Workers Union (CWU).

Chief executive Moya Greene said: "Through these new Sunday services we are exploring ways to improve our flexibility and provide more options for people to receive items they have ordered online."

Union support for the move had enabled the company to "respond quickly to a changing market", she added.

CWU deputy general secretary Dave Ward said: "Royal Mail's announcement about expanding delivery and collection services to seven days a week is an exciting innovation which we welcome.

"We appreciate that in order to stay competitive in a broadly unregulated sector, Royal Mail has to expand its services to its customers.

"We believe that offering Sunday delivery and collection services is the right response from the company.

"With ever-increasing numbers of people opting to shop online, Sunday services are necessary to deal with the growing demand in parcel delivery.

"The union is negotiating with Royal Mail nationally to ensure that postal workers who are affected by these changes receive good terms and conditions and, where appropriate, that work is performed on a voluntary basis."

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UK Retail Sales Growth Hits 10-Year High

A late Easter helped boost UK retail sales to a 6.9% growth rate for the year, the highest since May 2004.

The Office for National Statistics (ONS) said retail sales volumes jumped by 1.3% on the March figure.

A consensus among economists had forecast the rise to be around 0.5% on the month and 5.2% on the year.

The ONS said food sales jumped 3.6% in April compared to March, and 6.3% on the year, taking the rate to its highest level for more than 12 years.

It said the spike was due to better weather and promotions in-store.

More follows...

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M&S Annual Profits Drop For Third Year In A Row

Marks and Spencer has a revealed a 3.9% drop in full-year underlying pre-tax profit to £623m.

It was the third annual profit fall in a row for the high street icon.

The company said its like-for-like UK sales for general merchandise, which includes clothes and furnishings, were down 1.4% in the year until March 29.

In the same period its like-for-like food sales outperformed the wider market and were up 1.7%.

Mr Bolland has been in the top job at M&S since 2010

M&S has invested heavily during the last three years to try and revive its general merchandise business.

For the first time the profit outcome is below the annual profit made by faster growing fashion rival Next.

Total UK sales were up 2.3% in the year but general merchandise remained at 0%.

Multi-channel sales, including online and mobile, were up 22.8%.

It said the company's newly launched website would take up to six months "to settle in" and therefore revenue for the current quarter is expected to be adversely affected.

Chief executive Marc Bolland said: "We are focused on improving our performance in general merchandise and were pleased to see early signs of improvement.

"Our food business had a very strong year, consistently outperforming the market."

Last week Mr Bolland, who has now been in the job four years, announced a new campaign to push 19 million customers online.

He added: "Three years ago, we recognised the scale of investment required to transform our business, investing to strengthen our foundations and improve our customer offer.

"We are making solid progress on this journey and are now focused on delivery."

Sales at M&S were down for the eleventh quarter in a row last quarter, although clothing purchases did rise slightly.

The company was able to reduce its net debut by 6% in the year, to £2.46bn.

It said 2013/14 was a "significant year on our journey" as it seeks to transform itself from a traditional UK chain to "an international, multi-channel retailer".

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Consumer Inflation Rises In April To 1.8%

The consumer prices index (CPI) for April hit 1.8%, according to officially released figures.

The Office for National Statistics (ONS) said it was a rise of 0.2% on the March figure.

The rise was more than expected, up from its lowest level in more than four years.

The ONS said the late Easter break helped push up the cost of travelling.

Fuel prices were flat in April, compared to a 2.1p per litre month-on-month fall recorded in 2013.

Food prices, especially for vegetables, helped cap the rise.

Core CPI, which excludes food and other household components, rose 2% - the strongest rate since September.

The Bank of England (BoE) target for inflation is 2% and the CPI has now been below that figure for five months.

The CPI's six-month period of falls has now come to an end.

Weaker price growth has helped salaries and wages recoup lost ground since the 2008 financial crisis, however the latest figure show wage increases at 1.7% have now lost out to inflation again.

Meanwhile, the ONS said house prices were up 8% in March, year on year, slowing from a 9.2% figure in February.

The low level of inflation is helping the BoE to keep the base rate at its historic low of 0.5%.

More follows...

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Help To Buy: Cameron May Consider Changes

House prices rose in the year to March by 8% official figures show, as David Cameron said he will "consider" changes to the Help To Buy scheme if advised to do so by the Bank of England.

While the increase is down on the 9.2% rise in February, according to the Office for National Statistics, the continued strong price growth, particularly in London and the South East, is set to fuel criticism of the Government scheme underwriting home loans for people without large deposits.

It comes after the Bank of England governor Mark Carney told Sky News the housing market had "deep, deep" problems

In an interview with Sky's Murnaghan show on Sunday, Mr Carney warned rising house prices represented the biggest current risk to the economy.

More follows...

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Britain's Richest 1,000 People Now Worth £519bn

Billionaire Britain: Rise Of The Super-Rich

Updated: 7:07am UK, Sunday 11 May 2014

More than 100 billionaires are now living in Britain - the first time the milestone has been reached.

According to this year's Sunday Times Rich List, 104 billionaires with a combined wealth of more than £300bn are now based in the UK - more than triple the number from a decade ago.

Britain has more billionaires per head of population than any other country, while London has more than any other city with 72.

Top of the list are the Indian-born brothers Sri and Gopi Hinduja, who have an £11.9bn fortune.

The pair run the global conglomerate Hinduja Group and saw their wealth increase by £1.3bn in the last year.

In second place is Russian business magnate and Arsenal shareholder Alisher Usmanov, who fell from the top spot after his fortune decreased to £10.65bn.

The richest Briton is the Duke of Westminster, who is 10th on the list with a fortune of £8.5bn.

Chris Dawson, who owns The Range discount store chain, saw his wealth rise by £695m in the last year to £1.28bn.

Jon Hunt, the founder of estate agents Foxtons, has a fortune of £1.07bn, a rise of £145m from 2013.

Mike Ashley, the founder of Sports Direct, and Virgin businessman Sir Richard Branson are also among the wealthiest 25 billionaires.

Ten years ago, a fortune of £700m was required to be among Britain's 50 wealthiest people.

Now it is £1.7bn - the first time since 2008 the minimum wealth of the top 50 has been more than £1.5bn.

The combined fortune of Britain's richest is now ahead of pre-recession levels of 2008.

Last year there were 88 billionaires, worth a total of more than £245bn.

A decade ago the number was 30, with a combined fortune of £65bn.

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Co-Operative Members Back Radical Reform

Members of the struggling Co-op have unanimously backed a major overhaul of the group.

It paves the way for radical reforms proposed by former City minister Lord Myners to go-ahead.

A timetable for carrying out the changes will be agreed at a board meeting later this month, as the Co-op warned tough times lay ahead.

Some reforms will need rules to be altered, and so require further votes.

Co-op Group chair Ursula Lidbetter, who announced she will step down after a transitional period, said the mood at the annual general meeting was "thoughtful and sober".

She hailed the vote as a "highly significant moment" for the group.

Speaking ahead of the vote, Ms Lidbetter told delegates "catastrophic failure of governance" had taken place at the Co-operative Group - but it was in its own hands to "make this business work again".

Lord Myners has said the Co-op is "not fit for purpose"

She said 2013 had been a "disaster waiting to happen".

Sky's City Editor Mark Kleinman said no-one had been expecting a unanimous vote, and Co-op executives were "breathing a sigh of relief" at the result.

After the vote Lord Myners said: "My job, when I was asked by the board, was to do a thorough review of governance and I have done that.

"Quite forthright, that upset some people, but I think it was necessary to be frank and straightforward, and people have obviously listened with care."

He has proposed a shake-up of the 150-year-old business which reported losses of £2.5bn for 2013.

The plans include sweeping away the existing 20-strong board of representatives from the Co-operative Group, who currently include an engineer, a plasterer and a retired deputy head teacher.

He wants to replace this with a slimmed-down "plc and beyond" structure staffed by professionally-trained directors.

Euan Sutherland left the Co-op, saying it was "ungovernable"

The former Marks & Spencer chairman was appointed a director of the Co-operative Group in December, but is to leave following the vote.

He said it was apparent to him from the first time he attended a board meeting that not one of its members had the ability to address the complex issues faced by a group burdened with £1.4bn of debt.

Lord Myners believes that the Co-op will survive but faces the prospect of having to sell assets such as its £1bn funeral care business, in order to meet the demands of its lending banks, if it does not adopt reform.

Resistance to the changes saw chief executive Euan Sutherland leave the group earlier this year, saying it was ungovernable.

The decision on the reforms was taken by representatives of its independent societies and affiliated organisations - who hold 22% of the vote - and others voting on behalf of its regional membership boards making up the remaining 78%.

Ms Lidbetter said: "There is a huge task ahead of us if we are to deliver the reforms necessary to restore the Group's reputation and return it to health but the board will work hand-in-hand with our members to ensure that we seize this opportunity.

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Carney: 'House Prices Biggest Risk To Economy'

By Ed Conway, Economics Editor

The British housing market has "deep, deep" problems, according to the Governor of the Bank of England.

In an interview with Sky's Murnaghan show to be broadcast in full later this morning, Mark Carney warns that rising house prices represents the biggest current risk to the economy.

And the number of large mortgages being approved to house buyers is on the rise, he adds.

Mr Carney says that the UK is in need of new house building.

He says that compared to his home country of Canada, for example, the UK built half the number of new homes every year despite having twice the population. 

Canada builds around 200,000 new homes a year compared to just 133,000 similar properties that were built in the UK last year.

Mr Carney said: "The issue around the housing market in the UK … is there are not sufficient (numbers of) houses (being) built."

Mark Carney has issued a warning over the UK housing market

Asked if more houses need to be built, Mr Carney replied: "That would help us out.

"We're not going to build a single house at the Bank of England. We can't influence that.

"What we can influence … is whether the banks are strong enough. Do they have enough capital against risk in the housing market?"

Mr Carney said they could also check lending procedures "so people can get mortgages if they can afford them but they won't if they can't".

"By reinforcing both of those we can reduce the risk that comes from a housing market that has deep, deep structural problems," he added.

Mr Carney said there was evidence that large mortgages, where lenders approve loans of more than four times people's salaries, are on the rise again.

"We don't want to build up another big debt overhang that is going to hurt individuals and is very much going to slow the economy in the medium term," he said.

"We'd be concerned if there was a rapid increase in high loan-to-value mortgages across the banks. We've seen that creeping up and it's something we're watching closely."

In an separate interview for Murnaghan David Cameron admitted the Government needed to build more houses and said Mr Carney was "absolutely right".

However, he added: "The building of houses is going up. If you talk to any housing developer at the moment or builder they will tell you that the help to buy scheme the Government has put in place has been hugely helpful in bringing forward more development or house building.

"We are training apprentices in the building trade to make sure that we can deliver on these houses but we do need more, yes."

Last week, Mr Carney surprised many by playing down the chances of an imminent rise in interest rates despite fears of a growing house price bubble.

But he admitted the issue was the biggest current threat to the economy.

"The biggest risk to financial stability, and therefore to the durability of the expansion, centres on the housing market and that's why we're focused on that," he said.

Prices are currently rising at more than 10% a year across the country.

Analysis by Sky News has shown the number of £1m properties has doubled since 2008.

Earlier this month, the OECD think tank called on the Bank of England to impose measures to help quell rising house prices.

Both the coalition and Labour are committed to building hundreds of thousands of new homes.

However, construction still lags behind Government targets.

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